How To Start A Business With No Money - 7 Tips

Uncategorized Aug 13, 2020

 

So you want to start a business, but you don’t have much money to start with? Today I’m going to give you 7 ways you can start a business with no money or very little money so that you can start taking action toward a better future right now.

One of the questions I get allll the time is how much money is needed to start a business. Now, like anything, there’s a lot of variables and unknowns to this question. But I wanted to try and give some ideas and inspiration about how to get started if you find yourself in a place where you’d love to start your own business, but feel like you don’t have the capital available to do so.

I know at times like we’re facing right now, unemployment is rising and the economy is looking a little shaky. But some of the fastest-growing startups like AirBnb, Whatsapp, Venmo and Groupon were birthed in the last recession and so, if approached with the right mindset, this could be a defining season in your life.

Before we jump into it, one quick note - there are lots of businesses you could start that require “no money” - but what you’ll be using instead is your time. And, if you could spend 4-6 weeks generating startup capital in order to launch a business, rather than trading 12 months of time to get it off the ground - I would always choose the money route.

The goal is moving away from trading time for money - not jumping out of a job into a business that has us working more hours for less return.

To stop trading time for money you need to build a business that has leverage and can grow quickly, and startup capital will always help that.

So, what are your options?

1. Sell Some Stuff!
This, like anything, is a mindset question. You see, the question is not how much money fo you have, but how much determination do you have? If you could build a brand hat generates multiple six figures like some of my students have, seven figures and beyond, what would that mean to you? What price would you pay to make that happen?

The first thing to do is take that mindset and walk around your house. What do you have that you could live without? What could you sacrifice in this season knowing that it was like a seed being placed in the ground of your business that would produce something great in the future.

Old gadgets, memorabilia, jewellery, clothes, cars, TVs - whatever! Often people are amazed at how much they could generate over a weekend just by listing a bunch of stuff they don’t want or need anymore on eBay.

For some, there may be a few more painful decisions like having to sell a car and walk to work, but what matters more your current mobility or your future freedom?

There will always be people out there saying “you need money to make money”... and there will always be people out there making it happen.

2. Family & Friends
Of course this may not be possible for everyone, but another option is to approach family and friends about supporting you in your first venture.

Six or seven years ago when I began my route into eCommerce I asked my Dad if I could borrow £3,000 to buy some t-shirts from China. He thought I was a bit strange, but he helped me out with the startup cash and I put it to work.

Was I nervous about asking him? Of course. But to build a business you need to take steps outside of your comfort zone.

3. Business Partner
There comes a point in an entrepreneur's life when they run out of time. There’s only so much they can, or want to do with the time available to them. Once they’ve had some success, built some business, and have capital available to them, there are many who enjoy the role of investor.

Someone who has the capital available can invest in your business and partner with you. Just take a look at the TV shows Dragon’s Den or Shark Tank in the US. This is the exact model. These business owners don’t have the time to roll their sleeves up and build another business. But they’ve got capital, and by becoming a partner in the business they are invested in your success.

Who could you approach that could invest in your business and partner in your success?

4. Crowdfunding
Crowdfunding is the process of raising capital for your product or project before you begin. It’s becoming ever more popular through platforms such as Kickstarter and Indiegogo. I actually interviewed Mark Pecota in a recent podcast which you can check out here.

Mark is the founder of Launchboom, a crowdfunding agency - in that video are a bunch of tips around launching a product with crowdfunding.

5. Favourable Terms
This is probably the least likely of all options when starting out, but you never know where passion, enthusiasm and dogged determination can get you in life. Too many people give up too easy and this is an opportunity to test new options if all those before have come up with nothing.

When discussing your product or project with suppliers - ask if they will be flexible on terms. Perhaps you could place a nominal deposit to show commitment, then pay the balance on your order once products are being sold.

It’s a long shot, and usually only happens once you have built a history with a supplier, but if you’re going to be an entrepreneur, you’re going to have to knock on a few doors.

6. Credit
I’ve saved this one until (almost) last, as I know there is a wide range of opinions surrounding debt.

Debt can be crushing both in business and in personal finances, and I would never recommend anyone who does not have the ability to manage finances well to take on debt when launching a business.

However, if you do consider yourself to be someone who manages money relatively well, then there are a lot of options available to borrow money to fund a business startup. It won’t be a walk in the park, but banks across the globe are set up to lend money to businesses that have a solid business plan in place.

If you can borrow money at, say, 5% interest, and invest that in a physical products brand that should generate a return on investment of 100% then you have the potential for something great.

There is no better feeling than leveraging someone else’s money to build a business that you own - and that is the opportunity before you with taking on credit for your business. Just remember, debt can destroy a business if managed poorly, so consider your options wisely.

7. Keep It Lean
Finally, do everything you can to keep your business lean.

There’s no point starting a business with no money if you then can’t sustain that business. If you’re starting with a small budget then you will have to fight the urge to spend as revenue increases.

Keep expenses down, only invest in things that will either grow your top-line revenue or are absolutely essential to the maintenance of your business.

 

Listen, it won’t be easy to start a business with no money - but neither will working until you’re 80 to retire on a sub-standard pension. The future is yours to create so go out there and create it!

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